Ethereum Fees are Skyrocketing But Traders Have Alternatives

Photo: Coin Telegraph

(Coin Telegraph) - With the rapid growth of decentralized finance, upcoming scaling developments on Ethereum 2.0, and increased cryptocurrency allocation in the portfolios of institutions, the price of Ethereum (ETH) is rapidly ascending. In fact, we’ve already seen ETH break the $2,000 barrier for the first time, marking a brand-new all-time high.

All this action may be bullish for ETH holders and decentralised finance (DeFi) investors, but for smaller decentralised application (DApp) developers and other users on the network — such as traders using Ethereum Request for Comment (ERC)-20-based stablecoins — it’s quickly pricing them out.

That’s because the cost of using any stablecoin depends on the blockchain network on which it functions. And, once again, the Ethereum blockchain is finding itself plagued with network congestion and rising fees.

On Feb 23, the average transaction fee on Ethereum soared past $39 for the first time, making transacting with ERC-20 tokens like the Ethereum-based versions of Tether and USD Coin expensive and even prohibitive.

While Eth2 with its transition to proof-of-stake may hold the answers in the long term, traders are currently left frustrated. The good news is that there are alternatives to allow them to avoid price volatility by holding their value in stablecoins — without paying hefty network fees.

USDT and USDC on the Algorand blockchain

As a public and open-source smart contract blockchain using a Proof of Stake (PoS) consensus algorithm, Algorand provides the scalability and speed that Ethereum is currently lacking. By running USDT and USDC on Algorand, users can transact in their preferred U.S. dollar-backed stablecoin at a fraction of the cost and time.

Read more from the original article here.